So me and my friend are in a bit of a disagreement.
If you put 10 bucks on a lotto and you win 100 bucks. What’s the total money you have made in the end of the win. Is it 90 or a 100 bucks? The way I see it the moment you spent the 10 you’ve already lost it. So the whatever comes back is profit. What are your views?
The Initial Money You Bet Is That Counted as Loss or Not?
cya on 07/10/2020 - 16:07
Last edited 07/10/2020 - 16:39
Last edited 07/10/2020 - 16:39
Poll Options
- 2Total winnings/ Profit $100
- 97Total winnings/ Profit $90
Comments
Yep 900% profit 1000% return. Same as 10-1 on the races.
It's nice to see a fellow ozb that knows basic maths.
Just a random question as I used to work in a betting shop in the UK about 20 years ago. Over there you would also get your initial bet back, so at 10-1, you would get 11 pounds back, is it different over here?
Lottery tickets were different, it was just the winning value paid out not the initial bet.
The odds are the return here, not the profit. So 2-1 you'll double you money; handed over one get two back.
$90 Won
The $10 spent is returned to you and is not "winnings"
It could be 100 profit if you accepted that you've already lost the entirety of money before you learnt the result of the lotto.
If you think of your lottery ticket as a single share of a company on the stock exchange, you've spent $10 on one share. Suddenly it's worth $100. The ATO expects you to pay tax for $90 of capital gains, not $100.
Philosophically, my opinion is it depends how long since you spent the $10 and whether it was cash.
Cash =/= real money so that's $100 profit
If you spent the money a week ago and win $100 it's $100 profit
If you walk into a newsagent and buy a scratchy on a whim and win $100 then it's $90 profitIf you had a business and bought $100 worth of stock in July and then sold that stock in June for $200 would you tell the ATO you made a profit of $200 and not deduct the initial $100 expense? Time has nothing to do with this lol
Poll required
Purely in accounting terms:
$10 spent on X
$100 earned
Profit = 100-10
Expenses = $10
If you were to lose then it is a loss after the result of the lottery. It is an unrealised loss or expense until the result of the lottery.The least you could do is provide an MSPaint diagram to help us.
This is why Scott Pape wrote his book.
You put down $10 and win $100 and you are not sure what you are left with cash flow wise? ($90)
Recipe for disaster.
Barrows Gloves
The way I see it the moment you spent the 10 you’ve already lost it. So the whatever comes back is profit.
According to you If I buy product x for $10 and then sell it for $100 that means I made $100 profit. Your logic is flawed.
That is how we get people to be cash flow negative on property so they can pay $1 and get $30c back at end of the year on the interest component which is not all that much now. (Negative gearing on investment property).
In the UK the bank won't look at you unless your gross rent is 145% of your monthly payments with affordability at 5.5% interest rates. So everyone is positively geared
I can guarantee you can win $10,000.
Just give me $20,000 first.
If you spent $500 on the lotto tickets would you still see it as $100 profit?
I suspect they would. I know plenty of people who brag about how much they win on pokies / lotto without ever considering what they spent.
So your saying if you had a slap on the pokies and slid a pineapple in, and took twenty out, you would be pumped and tell your mates you won twenty bucks?
I've entered the nuffies side of OzBargain. Are you serious or just trolling!?
Grade 1 maths should give you the answer.
It's a 1000% return.